Sirius-Howard Stern Follow-up
Following up on last Saturday’s post, Sirius informed the SEC on Wednesday that Mr. Stern is free to do what he wants with his 34 million shares he and his manager just received:
Activity surrounding the stock of Sirius Satellite Radio was frantic on Wednesday after the company announced that its star talent, the very well-paid Howard Stern, could sell his considerable equity share in the company any time he chooses to do so.
….. Stern was reportedly awarded 31.25 million shares of Sirius on Monday, the same day his show debuted on the No. 2 satellite radio company. Buchwald was also reportedly given 3.125 million shares. According to published reports, the pair were to be awarded the shares in 2010, though Sirius accelerated the date to Monday based on the positive impact Stern has had on subscriber growth.
Given that Mr. Stern has talked up the stock, saying it should be trading as high as $10 (Friday’s close was $6.28), some people are outraged:
- Jim Cramer (HT PunditReview) — “Am I an idiot, or did Howard Stern just do the greatest pump and dump in history? ….. Now, you could argue that Stern knew nothing and that he simply doesn’t matter. He can say what he wants because he is a big star. But last I looked, there was no Big Star immunity to the 1934 Act.”
- Learning Curve — “He’s no dummy. I don’t know if SIRI will make it over the long run. They’re sure spending lots of cash.” That was among the points of last week’s post.
- Wall Street Fighter post title — “Stern Is Screwing You.”
I would suspect that regulators may be among the displeased, but Cramer says “the feds won’t chase the shock jock.” Do you think they’d cut a conservative talk radio host in a deal like this the same slack?
